TIDMSAB
RNS Number : 1053Y
SABMiller PLC
21 January 2014
21 January 2014
SABMiller plc Trading Update
SABMiller plc today issues its interim management statement for
the group's third quarter ended 31 December 2013 which also
represents a trading update for the same period. The calculation of
the organic growth rates excludes the impact of acquisitions and
disposals.
Alan Clark, Chief Executive of SABMiller, commented:
"Growth in the third quarter was driven by our emerging market
businesses where we are successfully targeting new consumers
through affordability and premiumisation initiatives across our
brand portfolios. The combination of pricing and volume growth,
particularly in Africa, Latin America and China, supported net
producer revenue growth of four percent. This was in spite of
continued weakness in consumer sentiment, which particularly
impacted our European and North American businesses."
Third quarter highlights
Group net producer revenue (NPR) for the third quarter grew by
4% and group NPR per hectolitre (hl) grew by 2% both on an organic,
constant currency basis
Total beverage volumes grew by 2% for the third quarter on an
organic basis, with lager volumes up 1% and soft drinks volumes up
7%
Depreciation of key currencies against the US dollar will
adversely impact reported results
The group's financial performance is in line with
expectations
Latin America
Above mainstream brands drove group NPR growth
Latin America group NPR grew by 5% in the third quarter on an
organic, constant currency basis, despite cycling strong
comparatives in the prior year. Total beverage volumes increased by
3% on an organic basis, with lager volumes up 2%. In Colombia,
lager volume growth of 1% was driven by Aguila Light which
benefited from the expanded reach of the more affordable bulk
packs. In Peru, lager volumes were in line with the prior year,
notwithstanding the continuing impact of the excise tax increase
earlier in the year. Pilsen Callao, our upper mainstream brand,
grew by double digits, replacing Cristal as the leading brand in
Lima. In Ecuador, increased direct coverage supported lager volume
growth of 4%, with upper mainstream Pilsener Light continuing to
grow strongly. In Central America lager volumes grew by 3% in the
quarter, assisted by the continuing success of the larger packs in
El Salvador, and robust Miller Lite performance in both Panama and
Honduras. Soft drinks grew by 8% across the region on an organic
basis, with pack innovations supporting growth, particularly in
Colombia and Peru.
Europe
Unfavourable performance in challenging market conditions
In Europe, group NPR on an organic, constant currency basis
declined by 6% as a volume decline of 2% was coupled with
deterioration in group NPR per hl due to adverse category mix.
Lager volumes were down by 5%. Volume performance in the Czech
Republic stabilised with domestic volumes in line with the prior
year despite the continued challenging market environment. In
Poland volumes were down 4% impacted by competitive intensity and
continued weak consumer spending. Domestic volumes in the UK were
up 9% led by Peroni Nastro Azzurro as a result of increased
distribution and an improved rate of sale. Tough trading conditions
and consumer trends have continued into the third quarter impacting
our trading in Italy and Romania. Anadolu Efes' volumes grew on an
organic basis driven by the continued growth of soft drinks volumes
while lager volumes were negatively impacted by market regulations
in Turkey and on-going softness in Russia. On a reported basis
Anadolu Efes' soft drinks volumes benefited from the full
consolidation of the Coca-Cola Icecek results.
North America
Portfolio evolution towards above premium continues, driven by
the Redd's franchise
MilllerCoors' group NPR grew by 1% with lower volumes offset by
positive sales mix and higher net pricing. US domestic sales to
retailers (STRs) declined 1.9% in the quarter. Premium light STRs
declined mid single digits in the quarter with Coors Light down low
single digits and Miller Lite down mid single digits. Premium
regular brands declined low single digits in the quarter with mid
single digit growth of Coors Banquet offset by a double digit
decline in Miller Genuine Draft. The Tenth and Blake division saw
low single digit growth driven by Leinenkugel's and Blue Moon
partially offset by reduced volumes of Henry Weinhard's. The rest
of the above premium portfolio grew strongly benefiting from
innovation, particularly the notable success of the Redd's
franchise. The below premium portfolio declined by mid single
digits. Domestic sales to wholesalers (STWs) for the quarter were
down by 2.2% compared with the same period in the prior year.
Africa
An encouraging delivery despite some challenges
In Africa group NPR grew by 8% on an organic, constant currency
basis underpinned by pricing and total volume growth of 5% with
lager growth of 6%. Group NPR per hl grew by 3% for the quarter on
an organic, constant currency basis. Lager volumes in Tanzania grew
by 5% driven by strong growth in the mainstream and affordable
segments. In Zambia lager volume growth of 12% was supported by
increased availability and trade buy in ahead of the January 2014
price increase following the 50% increase in excise. Political
unrest in Mozambique had a negative impact on lager volumes
resulting in a decline of 2% in the quarter. Increased capacity in
Nigeria continued to support strong growth with Hero Lager and
Trophy Lager performing well. Soft economic conditions in Uganda
and Zimbabwe persisted in the quarter resulting in declining lager
volumes versus the prior year. Our associate Castel also delivered
lager volume growth of 6% with Angola performing ahead of
expectations. Soft drinks volume growth of 5% was driven by good
performances in Ghana and Zambia, as well as our associates Castel
and Delta in Zimbabwe. Other alcoholic beverage volumes ended the
quarter 2% ahead of the prior year on an organic basis, driven by
good Chibuku growth in Zimbabwe which was partially offset by a
decline in Zambia.
Asia Pacific
Group NPR growth driven by China
Asia Pacific group NPR grew by 6% on an organic, constant
currency basis, continuing the positive trends of the earlier part
of the year. In Australia, domestic lager group NPR declined 1% as
a volume decline of 4% was largely offset by an improvement in NPR
per hl. Soft volume performance was driven by category pressure
resulting from weak consumer sentiment and continuing intense
competition in all channels. Group NPR was supported by price
increases and selective investment to manage value as well as
positive trading performance of the international premium and craft
portfolios. In China, group NPR grew by double digits on an organic
basis reflecting strong volume growth of 13% and favourable mix,
primarily driven by strong portfolio premiumisation trends. In
India, group NPR was in line with the prior year, as favourable
pricing offset lower volumes which continued to be impacted by
regulatory changes made in the earlier part of the year and adverse
weather conditions in a number of states.
South Africa: Beverages
Pricing and brand mix in beer drove group NPR growth in a softer
consumer environment
In South Africa, group NPR for the quarter grew by 7% on an
organic, constant currency basis, driven by group NPR per hl growth
of 6%, which benefited from price increases and positive brand mix
in beer, and volume growth in soft drinks. Lager volumes declined
by 2% in the weaker economic and consumer environment. The local
premium portfolio however continued to perform strongly, with
Castle Lite and Castle Milk Stout delivering combined growth in
excess of 10%. Focus on retail execution and customer service
continued to have a positive impact. Soft drinks volumes grew by
5%, cycling weak comparatives in the prior year, driven by targeted
market penetration programmes and continued good performance in
still soft drinks.
Group
Group NPR growth on an organic, constant currency basis in the
third quarter was driven by the mid to high single digit growth
recorded in Latin America, Africa, Asia Pacific and South Africa.
Trading conditions continued to be more challenging in North
America and Europe, with group NPR declining in Europe in the
quarter. On a reported basis, financial results were adversely
impacted by the depreciation of key currencies against the US
dollar, notably the South African rand, Australian dollar, Peruvian
Nuevo sol and Colombian peso. The group's underlying financial
performance is in line with expectations.
Other
On 18 December 2013, the group sadly announced the death of
Chairman Graham Mackay. The board appointed acting Chairman John
Manser as Chairman with immediate effect, and appointed Guy Elliott
as Senior Independent Director in succession to John Manser.
ENDS
Notes to editors
SABMiller plc is one of the world's leading brewers with more
than 200 beer brands and some 70,000 employees in over 75
countries. The group's portfolio includes global brands such as
Pilsner Urquell, Peroni Nastro Azzurro, Miller Genuine Draft and
Grolsch; as well as leading local brands such as Aguila (Colombia),
Castle (South Africa), Miller Lite (USA), Snow (China), Victoria
Bitter (Australia) and Tyskie (Poland). SABMiller also has growing
soft drinks businesses and is one of the world's largest bottlers
of Coca-Cola products.
In the year ended 31 March 2013 the group reported group lager
volumes of 242 million hectolitres, group net producer revenue* of
US$26,932 million and EBITA* of US$6,379 million. SABMiller plc is
listed on the London and Johannesburg stock exchanges.
*On 17th October 2013 SABMiller announced new and revised
reporting metrics in which a new reporting metric 'group net
producer revenue' and a restatement of the calculation of EBITA,
among other things, were explained. These new and revised metrics
are included above for the year ended 31 March 2013.
This announcement is available on the company website:
www.sabmiller.com
Further information is also available on:
www.sabmiller.com
www.facebook.com/sabmiller
www.twitter.com/sabmiller
www.youtube.com/sabmiller
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Enquiries
SABMiller plc
t: +44 20 7659 0100
Catherine May
Director of Corporate Affairs
SABMiller plc
t: +44 20 7927 4709
Gary Leibowitz
Senior VP, Investor Relations
SABMiller plc
t: +44 20 7659 0174
Richard Farnsworth
Business Media Relations Manager
SABMiller plc
t: +44 20 7659 0188
This announcement does not constitute an offer to sell or issue
or the solicitation of an offer to buy or acquire securities of
SABMiller plc (the "Company") or any of its affiliates in any
jurisdiction or an inducement to enter into investment
activity.
This announcement includes "forward-looking statements". These
statements may contain the words "anticipate", "believe", "intend",
"estimate", "expect" and words of similar meaning. All statements
other than statements of historical facts included in this
announcement, including, without limitation, those regarding the
Company's financial position, business strategy, plans and
objectives of management for future operations (including
development plans and objectives relating to the Company's products
and services) are forward-looking statements. These forward-looking
statements involve known and unknown risks, uncertainties and other
important factors that could cause the actual results, performance
or achievements of the Company to be materially different from
future results, performance or achievements expressed or implied by
such forward-looking statements. These forward-looking statements
are based on numerous assumptions regarding the Company's present
and future business strategies and the environment in which the
Company will operate in the future. These forward-looking
statements speak only as at the date of this announcement. The
Company expressly disclaims any obligation or undertaking to
disseminate any updates or revisions to any forward-looking
statements contained in this announcement to reflect any change in
the Company's expectations with regard thereto or any change in
events, conditions or circumstances on which any such statement is
based. Any information contained in this announcement on the price
at which the Company's securities have been bought or sold in the
past, or on the yield on such securities, should not be relied upon
as a guide to future performance.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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